Minnesota is engulfed in a massive welfare-fraud crisis that has flourished under Governor Tim Walz’s administration, costing taxpayers billions. State officials overseeing one of the nation’s most generous welfare systems have failed to impose controls, while media outlets look away for ideological reasons. Federal counterterrorism sources allege that significant portions of the stolen funds—often tied to members of Minnesota’s large Somali community—have been funneled back to Somalia, ultimately reaching the terror group Al-Shabaab. The scandal reflects a toxic mix of clan-based loyalties, bureaucratic naivete, and a political class too afraid of “racism” accusations to enforce accountability. Nowhere is this dysfunction clearer than in Minnesota’s Housing Stabilization Services program, a Medicaid initiative built with minimal oversight and “low barriers to entry,” originally projected to cost $2.6 million annually—yet now emblematic of a system designed, unintentionally or not, for exploitation on a massive scale.

Minnesota’s billion-dollar terror bombshell….

“The Largest Funder of Al-Shabaab Is the Minnesota Taxpayer”

How some of the state’s welfare funds ended up in the hands of a terror group

By: Ryan Thorpe, Christopher F. Rufo, City Journal, November 2025:

Minnesota is drowning in fraud. Billions in taxpayer dollars have been stolen during the administration of Governor Tim Walz alone. Democratic state officials, overseeing one of the most generous welfare regimes in the country, are asleep at the switch. And the media, duty-bound by progressive pieties, refuse to connect the dots.

In many cases, the fraud has allegedly been perpetrated by members of Minnesota’s sizeable Somali community. Federal counterterrorism sources confirm that millions of dollars in stolen funds have been sent back to Somalia, where they ultimately landed in the hands of the terror group Al-Shabaab. As one confidential source put it: “The largest funder of Al-Shabaab is the Minnesota taxpayer.”

Our investigation shows what happens w

hen a tribal mindset meets a bleeding-heart bureaucracy, when imported clan loyalties collide with a political class too timid to offend, and when accusations of racism are cynically deployed to shield criminal behavior. The predictable result is graft, with taxpayers left to foot the bill.

If you were to design a welfare program to facilitate fraud, it would probably look a lot like Minnesota’s Medicaid Housing Stabilization Services program. The HSS program, the first of its kind in the country, was launched with a noble goal: to help seniors, addicts, the disabled, and the mentally ill secure housing. It was designed with “low barriers to entry” and “minimal requirements for reimbursement.” Nonetheless, before the program went live in 2020, officials pegged its annual estimated price tag at $2.6 million.

Costs quickly spiraled out of control. In 2021, the program paid out more than $21 million in claims. In the following years, annual costs shot up to $42 million, then $74 million, then $104 million. During the first six months of 2025, payouts totaled $61 million.

On August 1, Minnesota’s Department of Human Services moved to scrap the HSS program, noting that payment to 77 housing-stabilization providers had been terminated this year due to “credible allegations of fraud.” Joe Thompson, then the Acting U.S. Attorney for the District of Minnesota, went even further, stating that the “vast majority” of the HSS program was fraudulent.

On September 18, Thompson announced criminal indictments for HSS fraud against Moktar Hassan Aden, Mustafa Dayib Ali, Khalid Ahmed Dayib, Abdifitah Mohamud Mohamed, Christopher Adesoji Falade, Emmanuel Oluwademilade Falade, Asad Ahmed Adow, and Anwar Ahmed Adow—six of whom, according a U.S. Attorney’s Office spokesperson, are members of Minnesota’s Somali community. Thompson made clear that this is just the first round of charges for HSS fraud that his office will be prosecuting.

“Most of these cases, unlike a lot of Medicare fraud and Medicaid fraud cases nationally, aren’t just overbilling,” Thompson said at a press conference announcing the indictments. “These are often just purely fictitious companies solely created to defraud the system, and that’s unique in the extent to which we have that here in Minnesota.”

Thompson said many firms enrolled in the program “operated out of dilapidated storefronts or rundown office buildings.” The perpetrators often targeted people recently released from rehab, signing them up for Medicaid services they had no intention of providing. He noted many owners of companies engaged in HSS fraud had “other companies through which they billed other Medicaid programs, such as the EIDBI autism program, the . . . Adult Rehabilitative Mental Health Services program, the . . . Integrated Community Support program, the Community Access for Disability Inclusion . . . . program, PCA services, and other Medicaid-waivered services.”

“What we see are schemes stacked upon schemes, draining resources meant for those in need. It feels never ending,” Thompson said. “I have spent my career as a fraud prosecutor and the depth of the fraud in Minnesota takes my breath away.”

On September 18, the same day that the HSS fraud charges were announced, the U.S. Attorney’s Office reported that a man named Abdullahe Nur Jesow had become the 56th defendant to plead guilty in the $250 million Feeding Our Future fraud scheme.

Founded in 2016, Feeding Our Future was a small Minnesota nonprofit that sponsored daycares and after-school programs to enroll in the Federal Child Nutrition Program. The organizations that Feeding Our Future sponsored were primarily owned and operated by members of Minnesota’s Somali community, according to two former state officials with connections to law enforcement.

In 2019, Feeding Our Future received $3.4 million in federal funding disbursed by the state. In the months after the Covid-19 pandemic began, however, the nonprofit rapidly increased its number of sponsored sites. Using fake meal counts, doctored attendance records, and fabricated invoices, the perpetrators of the fraud ring claimed to be serving thousands of meals a day, seven days a week, to underprivileged children. In 2021, Feeding Our Future received nearly $200 million in funding.

In reality, the money was being used to fund lavish lifestyles, purchase luxury vehicles, and buy real estate in the United States, Turkey, and Kenya. In 2020, Minnesota officials raised concerns about the nonprofit’s rapid expansion. In response, the group filed a lawsuit alleging racial discrimination related to outstanding site applications, noting that Feeding Our Future “caters to . . . foreign nationals.”

Continued……